This tweet probably made one options trader $2.4 million
Reuters
But as noted by Fortune's Stephen Gandel, Journal reporter Dana Mattioli teased the news on Twitter before there was a full article online.
And this one tweet from Mattioli may have been worth some big money to one trader.
Intel is in talks to buy Altera. Deal would be largest in Intel's history. Scoop w/ @danacimilluca coming to http://t.co/Q7kOQBB8Zh $ALTR
- Dana Mattioli (@DanaMattioli) March 27, 2015
According to Gandel, options activity in Altera shows that one trader made $2.4 million off that tweet.
Gandel reports that at 3:33 p.m. ET on Friday, one trader bought options contracts worth about 300,000 shares of Altera with a strike price of $36 and a mid-April expiration. Gandel notes that the whole trade cost about $110,000.
At the time, Altera shares were trading at about $34 per share, so these options were considered "out of the money" and cost about $0.35 apiece.
But after the Journal story broke, shares of Altera quickly spiked and closed near $44, bringing the price of each option to $8.50 and taking their collective value to $2.4 million.
Via Gandel:
Dana Mattioli is one of WSJ's main M&A reporters. So if you're training a computer to catch M&A news first, you would probably train it to focus on her. And "is in talks" is also a pretty likely key phrase one might flag the software to recognize. So perhaps it's not that surprising that a computer would pick up this deal.
High-frequency trading was the subject of Michael Lewis' book "Flash Boys."
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